Our work is focussed on the molecular mechanisms responsible for establishing and maintaining stable states of gene expression during vertebrate embryogenesis. Progress has been achieved in three key areas. First, we have defined the protein-nucleic acid interactions within a complete transcription complex assembled onto a 5S RNA gene. For the first time in vitro we have established conditions under which every gene is actively transcribed. Secondly, we have extended our understanding of the role of chromatin structure in preventing transcription factors from associating with genes. We have defined two distinct stages in chromatin assembly on replicating DNA: the addition of histones H3/H4 preceeds the deposition of histones H2A/H2B. In both Xenopus egg extracts and in a biochemically purified system we have examined the effects of this staged chromatin assembly on transcription. We find that a histone H3/H4/DNA complex is transcriptionally active. Therefore we can account for the transcription of newly replicated DNA and the gradual repression of genes as H2A/H2B are sequestered. Replication and transcription are associated with substantial changes is DNA topology, we find with both positive and negative supercoiling to be without effect on 5S RNA gene transcription. Finally, a new family of class II gene transcription factors have been cloned, their function analyzed and their developmental regulation studied. These Y-box transcription factors have properties consistent with their having a major role in regulating germ-cell specific transcription.